"Anti-Austerity" Mania

It’s midday Sunday; likely, within 24 hours of Greece either making an historic stand for its rights, or giving in to a handful of financial sociopaths – and in doing so, forsaking last month’s mandate by the majority of Greek citizens. True, the outcome may not necessarily be “black versus white”; as no doubt, if an agreement is made between Greece and the Euro Group, it will be carefully couched in language proclaiming “success.” In other words, pure propaganda; in a desperate, last ditch effort to prevent history’s largest Ponzi scheme from imploding NOW. Unquestionably, the global fiat currency regime is in its final death throes – with the only question being, can it survive the current Greek crisis? And if so, for how much longer?

After all, global economic activity is in all-out freefall; as evidenced by Friday’s all-time low of the Baltic Dry Index, which could plunge dramatically if this weekend’s West Coast dockworkers strike continues; the North American rig count, plunging at its most rapid rate in 20 years; and the U.S. Consumer Confidence Index, which last week had its largest “miss” versus expectations ever. Meanwhile, physical Precious Metal demand is going parabolic – particularly in China, per January’s record gold imports – making it more and more likely that the Cartel’s 15-year reign of terror is nearing its end; and with it, Central banks’ long-standing control of financial markets. To wit, this weekend’s comment by leading Cartel whistleblower Andrew Maguire, on just how intense the “gold wars” have become…

“Never before in the history of the market have I seen such strong physical buyers willing to sit and take on all the sell orders hitting the tape.”

Yes, today’s theme is unquestionably the financial mania created by unprecedented money printing, market manipulation and propaganda since the monetary system broke in 2008; but particularly, since Obama’s “closed door meeting” with the top “TBTF” bank CEOs on April 11th, 2013. Since then, the “Dow Jones Propaganda Average” has been goosed by the PPT’s “dead ringer” algorithm nearly every day; whilst paper gold and silver have relentlessly attacked every second the PM markets are open. Conversely, TPTB have clearly lost control of nearly all other markets – from commodities to currencies – whilst global economic activity has collapsed. Thus, it’s just a matter of time before these “last to go” markets, too, are swamped by “Economic Mother Nature.”

Everywhere one looks – politically, economically, and socially – madness reigns. As in Ukraine, where vicious, lethal fighting continues as if Thursday’s “cease fire” never occurred. Or Iraq, where U.S. “boots on the ground” are actively engaging “ISIS,” threatening to blow wide open the already gaping wound that is America’s international reputation – or whatever remains of it. Let alone, as blood-thirsty U.S. politicians spew reprehensible lies to push us toward World War III – such as thisincredible story of Senator Inhofe presenting Congress with falsified photos of Russian troops in the Ukraine. Then again, in difficult times, particularly when dealing with a dramatically “dumbed-down” population, propaganda tends to work like a charm; as Adolf Hitler knew well, per this quote from his autobiography, Mein Kampf, which I am currently reading.

“Propaganda’s chief function is to convince the masses, whose slowness of understanding needs to be given time so they may absorb information; as only constant repetition will finally succeed in imprinting an idea on the memory of the crowd.”

Yes, madness; which even my relentless discussions of money printing, market manipulation, and propaganda fail to capture, in terms of just how far from reality they have pushed asset values. To wit, the utterly astonishing disparities between stock prices and economic trends in essentially all markets backed by major Central banks – as depicted in MUST SEE charts like thisand thisand this. Which in turn, generate “renewed optimism” each week; as amazingly, U.S. economic data expectations continue to be positive despite the U.S. macroeconomic picture sitting at a multi-year low. Last week alone, all six major economic reports declined – in all cases, by “more than expected”; including retail sales, mortgage purchase applications, wholesale sales, jobless claims, small business confidence, and consumer confidence – not to mention, the unexpected surge in petroleum inventories. And yet, as always, essentially all Wall Street estimates for this week’s reports assume growth!

Yes, “par for the course” for a manipulated world gone mad; in which the few remaining market participants – other than government and “TBTF” bank algorithms – have been brainwashed into believing that manipulated stock, bond, currency, and precious metal prices, among others, actually suggest “consensus views” – contrary not only to centuries worth of data and conventional wisdom, but common sense itself.

And nowhere is such lunacy in full force – per this Michael Pento article – a growing confidence that because “austerity” has failed, the re-emergence of “anti-austerity” policies – by some form of perverted “logic” – must “succeed.” In layman’s terms, like trying to “cure” a drug addict’s withdrawal symptoms with larger doses of drugs. Yes, because TPTB have managed to goose the Dow, DAX, and Nikkei – among others – via money printing and market manipulation; whilst suppressing Precious Metals and watching the entire world front run Central bank monetization of sovereign bonds, the latest meme is that “markets” anticipate new, wildly irresponsible deficit spending schemes will somehow work where austerity didn’t. And not just in Greece, but other PIIGS, too – and essentially everywhere else. Including the U.S., which just two years after its pathetic “fiscal cliff”, “debt ceiling,” and “sequester” battles – and three years after losing its triple-AAA rating (when its debt hit $14.1 trillion, vs. $18.1 trillion today) – is proposing its largest deficit spending plan yet.

No matter that economic activity – both in the U.S. and abroad – is much lower than when “austerity” started in 2010-12; that debt, on all levels, is much higher; or that the average currency has lost nearly 40%, yielding a vicious, economy-destroying combination of inflationary and deflationary forces. No, so long as manipulated markets paint a fraudulent picture, why not believe current policy is “working” – and capitalize on it politically?

Thus, the outcome of this week’s Greek “decision” – which theoretically, could be delayed until the true bailout deadline of February 28th – is so vitally important. If Greece defies the Euro Group completely – exiting the Euro and defaulting on its debt, all bets are off, as the “end game” will have commenced. However, if Alexis Tsipras caves in to Brussels beaurocrats – yielding increased and extended bailouts – it could signal a new, unprecedented phase of European debt expansion; yielding still larger wealth disparity, and welfare dependence. Actual economic activity will not improve a whit; and in fact, will weaken further as nothing whatsoever will have changed, other than parabolic debt accumulation. Which will only fuel further QE schemes and market manipulations, as the forces of reality push still harder on artificial asset prices; i.e., the all-time House of Cards. In a nutshell, as described by Hans-Werner Sinn, head of Germany’s IFO economic institute, “Grexit would be best, because if Greece doesn’t exit the euro, it will keep adding new debt it will be unable to repay.”

That said, the rest of Europe is waiting to see how the “Greek Tragedy” resolves itself – at least, in the near term; as countless other nations have “Syriza-like” movements on the verge of taking power – starting with much larger Spain, where the newly formed Podemos party’s charismatic leader, Pablo Iglesias Turrión , appears a shoo-in to become Prime Minister in December’s elections. As well as Italy, France, and others, as the “revenge of the people” I forecast last year comes to fruition.

Essentially, said “anti-austerity mania” will dramatically worsen the current, historically bad social, economic, and political conditions engulfing Europe; much less, anywhere that such wild deficit spending is practiced – from China, to Japan, America, and anywhere that local currencies haven’t yet been destroyed. “Anti-austerity” is what got us into this mess in the first place – starting with abandonment of the gold standard in 1971; and now that global debt sits at record levels, the effect will be no different than pouring gasoline on a fire.

Remember, the only way “anti-austerity” can be deemed “successful” is if TPTB can maintain – and expand – record high paper asset valuations in the face of plunging fundamentals; whilst maintaining record low Precious Metal valuations in the face of explosively positive fundamentals. To that end, what makes more sense, buying stocks and bonds at all-time highs, or gold and silver at all-time lows?

10 Comments

RF
on February 16, 2015 at 1:17 pm

Andy,

Great article and thank you.

At our house we started austerity about 5 years ago as we are expecting a financial collapse once the central bankers (criminals) loose control.

No one can be totally prepared but we have done the best we can.

We started by getting out of the banking system, which at first seemed weird, but now would not have it any other way.

We are kind of use to austerity, but I know what is coming will not be fun. Just pray we all come through to the other side.

Theravaida
on February 16, 2015 at 3:35 pm

Greece talks have broken down, good one on Tsipras, Varoufakis and Syriza gang. Looks like they’re really serious to call the banksters bluff. They better watch out for their life.

The contract between the ILWU and the Pacific Maritime Association (a conglomeration representing the interests of shipping companies, mostly foreign); expired in June ’14, and negotiations since have been unsuccessful. The PMA accused the union of slowdowns (not entirely accurate, the union has the production numbers/ records to prove it), and in addition claimed that there was no yard space for storage (another lie, the union has aerial photographs to prove there is plenty of yard space available). The employers have drastically reduced the normal 24 hour operation to weekdays/ day shift only; hence the buildup of ships lined up in the harbor, a curious move if there is such a cluster$&@/. I’m not suggesting that the union is always right or 100% lacking in corruption, but in this particular case the PMA is blatantly lying, and I am shocked at the lack of their business ethics, but not shocked at all by the lame-stream media distorting the truth, a practice that they excel in. I do, however, thoroughly enjoy and learn from your articles, your weekly discourse with Kerry Lutz as well as your Miles Franklin blog.

i thought I would take the opportunity to comment on your linked article on Andrew McGuire.

Hi Andy

I was so optimistic about the effect McGuir’s testimony would have at the CFTC meetings all those years ago. KWN ran the story at the time, and I thought “this is it, no more hiding the truth” but alas, this is not the real world, only one created by wishful thinking and unrealistic optimism.
The hit was undoubtably real on McGuire, and must have gone all the way up to the top, as I can tell you, as an ex-Londoner you are on CCTV everywhere you go with full facial recognition software tracking your every move. To think an HGV driver could do a hit and run and get away with it in the capital is laughable. Also once you have police chopper tracking you you have ZERO chance of escape as they synthetic aperture radar that can track you into any building.
I can also tell you that a hit and run like this would not be considered as dangerous driving which can actually carry a custodial sentence, no, this was attempted murder, or at best Actual bodily harm with grievous intent. Either way you want to look at it its jail time.
Unless of corse they are working for a government agency or for the City of London Corporation, in which case it’s a fine and a slap on the wrist.

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